Nomura assigns 'buy' rating on Godrej Consumer

Nomura Equity Research has assigned a 'Buy' rating on Godrej Consumer (GCPL) with a target price of Rs 833.

The stock is currently trading at Rs 718.50 on the BSE. "While we have been bullish over the past couple of years on GCPL's strategy of significantly expanding its presence in emerging markets across Asia, Africa and South America, we believe, the delivery process should gather steam over the next couple of years," it said.

According to analysts at Nomura, GCPL now has a well-diversified portfolio and geographical split, which will free the company from its reliance on its domestic soaps business.

"With sector-leading growth rates in terms of revenue and profit, and valuations which are at a discount to the sector average, GCPL remains our top pick in the mid-cap consumer space,"it said.

"While the company has gained significant share in these businesses over the past year or so, we believe, scope remains for further gains, albeit at a slower pace," the report said. DRL's market share on Metoprolol has increased to 15% vs. expectation of 8-10%. Metoprolol market size is large at $450 million and is a high-margin product.